In The Trustees of the BT Pension Scheme v HMRC [2015] EWCA Civ 173 (9 July 2015) the Court of Appeal found that the trustees’ claims for tax credits were time-barred.
The trustees were appealing HMRC’s decision to disallow claims for the payment of tax credits related to dividends received by the BT Pension Scheme (an exempt approved scheme). These had been calculated by reference to the advance corporation tax (ACT) paid by UK distributing companies.
Under the ACT regime (abolished with effect from 6 April 1999) as pension schemes had virtually no taxable income (against which tax credits could be set off) credits gave rise to payments by HMRC. However the receipt of foreign income dividends (FIDs) (dividends paid by a UK company in relation to income received by it from its subsidiaries) did not entitle the recipient to a tax credit. The recipient was...
